The End Of The Secondary Line Brand Is Just Beginning.

In addition to Burberry, many luxury brands have a sub line brand. Among the 10 most famous luxury brands, Christian Dior, Tod 's, Prada, Giorgio Armani, Ermenegildo Zegna and other half brands all have a sub line brand, showing the meaning of the collateral brand for luxury goods.

Among them, Armani is the first luxury brand to enable the concept of auxiliary line, and also has the largest number of secondary line brands.

However, in recent years, Dolce&Gabbana, Marc Jacobs, Victoria Beckham and other luxury brands have closed the sub line brands, and Burberry is now joining the ranks.

Cao Yang, a luxury brand digital media marketing manager, told the Beijing Business Daily that luxury brands were originally designed to cover more consumer groups through rich product lines and brand diversification. The price of the general secondary line brands is about 70% of the main line brand price.

However, with the increasing volume of sub line brand business, there are two kinds of situations: one is that the price and brand image are close to the main brand, and the reputation is bigger than the main card.

D&G and Marc by Marc Jobs are typical examples.

Statistics show that the average price of Marc Jacobs is about $389, while the average price of the sub line brand Marc by Marc Jacobs is US $188, and the difference between the main and subsidiary cards is out of the normal range of theory (70%).

In terms of sales volume, Marc by Marc Jacobs is also far ahead of Marc Jacobs. The sales volume of the former is 2 times that of the latter.

So Marc Jacobs had to merge Marc by Marc Jacobs into the main card.

D&G, whose annual gold intake was more than 400 million euros, was also overshadowed by the wind, which led to consumers' ignorance of the main card and being shut down by Dolce&Gabbana.

Another situation is that the price difference between sub line brands and mainline brands is gradually widening. Burberry London, Burberry Brit and Armani exchange belong to this situation.

In addition, some sub line brands need to be designed, produced and operated separately, which also creates a certain cost pressure on the brand as a whole.

Cao Yang said yes.

In order to reduce the price difference between the main and the subsidiary brands, the underlying reason is to protect the core value of Burberry better.

At present, many luxury brands have closed the sub line brand, but in Zhou Ting's view, the end of the sub line brand has just begun.

Zhou Ting told reporters why Herm s didn't set up a secondary line brand because it is the real top luxury product.

Once the sub line brand is established, the brand will become popular and fashionable. If it continues to sink, the brand will become a fashion brand.

Another situation is to return, like Burberry, to turn off the sub line brand and return to the original luxury position.

But in relative terms, once sinking, it is hard to return.

Therefore, Herm s will never be opened.

It always stays at that altitude and avoids popularization.

Nevertheless, the operating pressure of Herm s continued to increase. In the three quarter of fiscal 2015, group revenue grew 15.4% to 1 billion 143 million euros, still below market expectations. Meanwhile, Asia Pacific and the Americas market continued to be weak, achieving 1.5% and 2% growth respectively.

Most of the other luxury brands with sub line brands are also facing recession. For example, the Prada group, the main brand Prada and the sub line brand MiuMiu have handled very well, and the design and price structure are not violating each other. However, the earnings reported recently announced that the group's net profit fell by 37.6% to 46 million 484 thousand euros in the three quarter ended October 31, 2015.

On the whole, there will be more luxury brands to be closed in the future to ensure high-end brand image and improve performance.

Cao Yang Quotes

Vincent Bastien, a senior manager of the industry, told reporters that "brand extension is a good marketing strategy in the short term, but it may seriously affect brand image in the long run".

At the same time, under the background of the rapid development of the current electricity supplier, the complicated sub line brand classification is not too meaningful for consumers. Luxury goods are facing many challenges. Closing the sub line brand is undoubtedly a helpless and reasonable coping strategy.

Zhou Ting believes that, on the one hand, the main demand of consumers is from brand to product. Consumers are more concerned about product design, quality and experience. Brand is not the most important factor, so the business mode of multi brand strategy will gradually become invalid.

On the other hand, the sub line brand has also been impacted by many designer brands and fast fashion brands.

"For luxury goods, the era of gold absorption by sub line brands is gone forever."